LEGISLATIVE UPDATE #2 JANUARY 11, 2006
I. HEARINGS ON BANKING BILLS SCHEDULED
II. LD 1680, SENATOR SULLIVAN’S DIRIGO HEALTH BILL HELD OVER FROM LAST SESSION – COMMITTEE VOTES TO KILL THIS BILL
III. TAX CONFORMITY FOR HSAs REMAINS ALIVE
IV. CEI PREDATORY LENDING STUDY TO BE RELEASED SOON
V. LAW ENFORCEMENT AGENCIES FORM BANK ROBBERY TASK FORCE & SPECIAL MBA/MACB SECURITY COMMITTEE MEETING
VI. MBA LEGISLATIVE COMMITTEE WILL MEET WEDNESDAY, JAN 13TH!
As we predicted, the Legislature immediately began its work and has held productive Hearings, Work Sessions, and voted to appropriate $5 million for heating oil assistance. The Governor’s State of the State Address will be held on Thursday January 17th. And, some of the most important banking-related LDs of the Session have been scheduled for Public Hearing in the next two weeks.
I. Hearings on Banking Related LDs
LD 1761, AN ACT to Offer Financial Institutions an Option for Payment of the Maine Franchise Tax, will have its Public Hearing on Thursday January 19th at 1:00 pm. This LD was proposed by the Department of Economic and Community Development and would allow financial institutions the option of basing their tax on either assets, or the current method, a combination of assets and income. DECD believes that allowing financial institutions the proposed option will assist them in recruiting new banks and their operations into Maine. Maine Bankers will be at the Hearing, which is before the same Taxation Committee that studied a 2005 proposal to increase the bank franchise tax!
LD 1782, AN ACT to Prevent Elder and Dependent Adult Financial Abuse will be heard by the Insurance and Financial Services Committee (IFS) on Tuesday, January 24th at 1:00 pm. This proposal would make bank employees mandatory reporters (to the Bureau of Elder and Adult Services) should they suspect financial exploitation of the elderly. California passed similar legislation last year though that law has a January 1, 2007 effective date. Maine Bankers will oppose this proposal, though offer to increase communications and training efforts for bank employees who voluntarily report.
LD 1783, AN ACT to Amend the Maine Consumer Credit Code as it Relates to Finance Charges for Loans on Open-end Credit, will have its Hearing also on January 24th before IFS. Maine Bankers Association had this LD introduced by Senate Chair Nancy Sullivan so that state chartered banks may offer home equity lines of credit that are accessed by means of a credit card. Out of state banks and national banks are offering this product today.
LD 1835, AN ACT to Protect Consumers from Credit Card and Debit Card Holds is tentatively scheduled for Hearing on Wednesday, January 25th before the Business, Research and Economic Development Committee. As drafted this bill would have the impact of eliminating the “pay at the pump” option for gas purchasers. MBA will oppose this proposal.
II. LD 1680, THE OMNIBUS DIRIGO HEALTH BILL THAT WAS HELD OVER LAST SESSION, WAS VOTED “OUGHT NOT TO PASS” BY THE IFS COMMITTEE! While this really isn’t too surprising, what was interesting was that most Committee Republicans supported holding the bill so as to reform Dirigo, while the bills Democratic sponsors urged its defeat! There will be other proposals from the Dirigo Agency later in this Session.
III. IFS COMMITTEE URGES TAXATION AND APPROPRIATION COMMITTEES TO SUPPORT TAX CONFORMITY FOR HSA ACCOUNTS! MBA has supported full tax conformity since their inception, and while there still will be a fiscal note before they can pass this proposal, there is bipartisan support for conformity. However, the Dirigo Agency continues to “study” the desirability of HSA accounts in general.
IV. COASTAL ENTERPRISES (CEI) WILL RELEASE ITS STUDY OF PREDATORY LENDING IN MIANE WITHIN THE NEXT WEEK. This Study will show that there is predatory lending occurring in Maine, that there are too many foreclosures and bankruptcies because of it, and that Maine policymakers may want to consider tougher predatory lending laws to prevent lending abuses. While CEI will state that this predatory lending is not as a result of Maine-based banks, we will brought into the debate because the distinction is not generally known to consumers and legislators!
V. LAW ENFORCEMENT AGENCIES FORM BANK ROBBERY TASK FORCE. For the first time in memory, after 13 bank robberies since mid-November, a number of law enforcement agencies have formed a Bank Robbery Task Force, which will share information and leverage resources. Maine Bankers Association was present at the beginning of the first Task Force meeting, held January 10th at the offices of the U. S. Attorney’s Portland office. Present were representatives from the FBI, which retains primary jurisdiction over bank robberies, especially armed robberies, Maine State Police, the U. S. Attorneys; Maine Drug Enforcement Agency, Cumberland County Sheriff’s Office and representative from more than a dozen local police departments. The key here is that these Agencies pledge to work together, sharing information and resources to lead to arrests, and prevent this outbreak of robberies.
There is a Special Joint Security Committee meeting on January 18th at the Portland Holiday Inn West, from 9:00 to Noon – this is a meeting of the Security Committees of both the Maine Association of Community Banks and Maine Bankers Association. They will discuss security issues surrounding bank robberies, and each member bank is encouraged to attend!
VI. MBA LEGISLATIVE COMMITTEE MEETS WEDNESDAY JANUARY 18TH AT 9:30, AT THE MBA OFFICES! With the number of LDs that will have hearings in the next two weeks this is a very important meeting to attend – we will strategize as to the Association’s position on the bank franchise tax issue, and also prepare testimony on the other major LDS that will have Hearings.
